Site navigation

Revolut CFO Resigns Amid Money Laundering Controversy

O’Higgins’ resignation marks a turbulent week for the challenger bank.

Peter O’Higgins, CFO at Revolut, has resigned following a difficult week for the challenger bank.

A report by the Telegraph this week revealed that Revolut has stopped using an anti-money laundering system, designed to flag suspicious transactions, due to an alarming number of false positives.

According to the publication, between July and September 2018, the system was inactive. Due to the system being offline, illegal transactions could have passed through the bank.

Revolut also failed to inform the Financial Conduct Authority that the anti-money laundering system was offline.

Headquartered in London, the bank was launched in 2015 by founders Nikolay Storonsky and Vlad Yatsenko. Since then, the bank has grown its customer base to more than four million throughout Europe.

The company has plans to expand globally in the near future.

Announcing his resignation, O’Higgins made no mention of the ongoing speculation caused by the Telegraph report and said that “the time has come” to allow a new CFO to lead the company through its latest growth plans.

“Having been at Revolut for almost three years, I am immensely proud to have taken the company from £1 million revenue to £50 million revenue during this time,” O’Higgins wrote in a statement.

“However, as Revolut begins to scale globally and applies to become a bank in multiple jurisdictions, the time has come to pass the reigns over to someone who has global retail banking experience at this level.”

O’Higgins’ resignation marks a turbulent week for the challenger bank. A report from Wired revealed allegations of toxic workplace culture and a high employee turnover rate.

“Former Revolut employees say this high-speed growth has come at a high human cost – with unpaid work, unachievable targets, and high-staff turnover,” wrote Emiliano Mellino.

Prospective recruits for the bank were required to take tests which involved bringing in new clients, according to Mellino – a task which they were not paid for.

“The instructions on the exercise said the applicants should recruit at least 200 clients in a week to have a chance at passing to the next interview phase,” he wrote.

This practice has since been shut down, according to Revolut’s head of communications, Chad West.

Revolut CEO Nikolay Storonsky published a response to this week’s events.

“This week, there’s been some misleading information in the media relating to our compliance functions. Compliance is, and always has been, a key priority for the company, so I wanted to address these accusations head-on and set the record straight,” he said.

“In July last year, we rolled out a more advanced sanctions screening system in parallel with our existing controls. Like any other technology company, we’re always looking to improve our systems,” Storonsky explained.

“During the initial testing stage of these new systems, we decided that they were not calibrated to a standard that we would expect, so we therefore decided to revert back to our existing controls, while we continued to enhance the new systems.”

Storonsky insisted that the company met all legal and regulatory sanctions requirements during this period, adding: “We conducted a thorough review of all transactions that were processed at this time, which confirmed that there were no sanctioned transactions.”